The two energy majors are deepening their cooperation in China.
The Shell-CNOOC complex by night Image: Shell |
Shell Nanhai BV and China National Offshore Oil Corporation have signed a heads of agreement to develop a range of upgrades and expansions at their existing 50:50 joint venture in Huizhou, Guangdong province.
The additional facilities will be close to the existing Nanhai complex and will include an ethylene cracker and ethylene derivatives units containing a styrene monomer and propylene oxide plant.
Upon completion, which is still subject to regulatory approval, the new cracker will almost double the plant's current ethylene production capacity, adding more than 1m tonnes per year.
A statement from CNOOC Chairman, Yang Hua, on Shell's website marked the expansions as supporting the two firm's "long-term petrochemicals strategy" to provide "industry-leading technology to produce petrochemicals for China's growing domestic markets."
Shell CEO Ben van Beurden added that the deal demonstrated the company's "ongoing commitment to China", after more than 100 years of operating in the region.
The plant will apply Shell's proprietary OMEGA and SMPO/POD technologies to produce ethylene oxide and ethylene glycol in an energy-efficient manner.
CNOOC has already started construction of the new complex and expects commercial production to come online in two years' time.